The thesis seeks to explain variation in party agreement on climate change, i.e. why there is cross-party consensus on the issue in some countries whilst there is party polarisation over it in others. The analysis thus provides a bridge between the literatures on comparative climate policy and party politics. The investigation employs a nested research design as a mixed methods strategy, joining the study of the wider universe of political parties and developed countries through large and medium-N analyses with intensive and qualitative case study analysis through a controlled comparison of Australia and Norway. These countries share significant similarities, yet Australia experiences party polarisation over climate change whilst there is strong cross-party consensus in Norway. In explaining this divergence, the thesis finds that parties will polarise over climate change if there is a presence of fossil fuel interests, multiple veto points, pluralist institutions and a majoritarian electoral system in the country. However, fossil fuel interests will not have a polarising effect if combined with few veto points and corporatist institutions. Countries that have few veto points, corporatist institutions and a proportional electoral system experience strong cross-party consensus. These findings challenge the common assumption that consensus will automatically be difficult in states with fossil fuel dependency. Rather, it demonstrates that the institutional context is critical, as it moderates the effects of fossil fuel interests and shapes the behaviour of parties. Although the thesis argues that parties’ ideology and levels of public concern also affect whether or not they embrace the issue and create agreement on it, institutional factors are demonstrated to have a relatively larger impact. Thus the thesis argues that party agreement on climate change is more an outcome of party strategic behaviour within the context of domestic party competition than it is a result of ideology or societal factors.